Annual offshore drilling auction to be held March 17

The Minerals Management Service announced plans on Friday to hold its annual auction of drilling tracts in the central Gulf of Mexico on March 17.

The sale will offer 6,800 blocks covering more than 35.9 million acres off the coasts of Louisiana, Mississippi and Alabama. Development of the tracts - which are located in water depths of between 10 feet and more than 11,200 feet - could produce as much as 1.3 billion barrels of oil and 5.4 trillion cubic feet of natural gas, according to the MMS.

"As we build a comprehensive energy strategy for our nation, we are moving ahead both with environmentally responsible renewable energy development on public lands and appropriate oil and natural gas exploration and development onshore and offshore," Secretary of the Interior Ken Salazar said in a statement. "Continued development in appropriate areas of the Outer Continental Shelf, such as in the areas we will offer in the Gulf of Mexico, is a key component of our efforts to reduce our country's dependence on foreign oil."

Louisiana should get direct cash benefits from the sale, which includes 4.2 million acres in an area called 181 South. The region is subject to a revenue-sharing arrangement between the federal government and Gulf states, giving 37.5 percent of profits from fuel development in the area to Louisiana, Alabama, Mississippi and Texas.